David Mowat
Main Page: David Mowat (Conservative - Warrington South)Department Debates - View all David Mowat's debates with the Scotland Office
(8 years, 11 months ago)
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David Mundell
What I think it suggests is the requirement for responsibility. If the Scottish Government believe that benefits are not at the level they should be, they will be able to ask the Scottish taxpayer for the funds to increase them. That is what I would regard as responsibility within a Parliament.
David Mowat (Warrington South) (Con)
A few minutes ago, my right hon. Friend described the fiscal framework of the Barnett formula as long-lasting and fair. Surely that would be the case only if the Barnett formula were based on need rather than on a historic anomaly. It is a formula that results in my constituents getting £1,600 less per person per year than they would get if it were based on need, which one would think a progressive party would wish to be the case.
David Mundell
My hon. Friend is a long-standing critic of the Barnett formula, and I acknowledge the point he makes. The Prime Minister, the then Leader of the Opposition and the leader of the Liberal Democrats made it absolutely clear that their parties had no intention of changing the Barnett formula. That certainly remains the position on the Government side.
Angus Robertson
The hon. Gentleman is usually assiduous in his research on these matters, but he has obviously not read to the end of the reasoned amendment tabled by the SNP, which I commend to Members across the House. It proposes that we would move
“to a position in the medium term where the Scottish Parliament and Government are responsible for all revenue raising”.
Clearly the Labour parliamentary research unit overlooked that point when sending round its briefings earlier.
Angus Robertson
I would like to make a bit of progress, and then I will be delighted to give way to the hon. Gentleman, whose interventions thus far have been tremendously helpful to the SNP.
I feel a sense of déjà vu as we discuss the contents of yet another Scotland Bill driven once again by the success of Scotland’s independence movement and party. The previous Bill, now the Scotland Act 2012, was the Government’s response to the Calman commission recommendations; the Calman commission, of course, was a response to the SNP’s first election victory in the Scottish Parliament in 2007, which enabled us to form an historic first minority Government. In 2011, though, the SNP had an even more dramatic and significant victory in Scotland. As Members will be aware, we broke the electoral system, gaining a majority in a proportional representation system designed explicitly to prevent that eventuality.
The constitutional response to the first majority pro-independence Government in Scotland in more than 300 years was the agreement to hold last September’s referendum. That is how we have got here today. The Bill’s genesis was in the referendum, and it flows from the desperate promises of the final few days of the campaign. The legislation before us comes from the vow made then, which was followed by the Smith commission and the five-party Smith agreement, albeit in watered-down form.
David Mowat (Warrington South) (Con)
It is a pleasure to follow the hon. Member for Moray (Angus Robertson), although it would certainly have been more of a pleasure if he had taken my intervention earlier. I will ask the question that I would have asked then. He made the point that the end of the SNP Members’ amendment says that they want full fiscal autonomy “in the medium term”. Would he care to tell the House when the medium term is? They were talking about a period of 18 months when the referendum was taking place.
The hon. Gentleman did say something that was correct: the people have spoken. The people spoke in the general election, and there is absolutely no question but that there is a mandate for the Bill before us. It is absolutely right that Members from both sides of the House move forward with the vow and all it means in a way that shows trust and good faith, and we will do that.
I will make a number of observations about the fiscal framework, and I would be interested to hear Ministers come back on those points. In his initial remarks, the Secretary of State used the phrase that the solution had to be long lasting and fair, which are big words. My concern is that a solution based on a fiscal framework that is not fair will not be long lasting. I do not believe that the use of the Barnett formula, as it is currently envisaged—even with changes through the devolution of certain revenue-raising powers—is fair on my constituents, or indeed those in Wales or in other parts of England. The flawed Barnett formula settlement is unfair on middle England, and as a result, this whole settlement may unwind.
Let me say a few things about the Barnett formula on which we need to be clear. The first is that it does not represent a subsidy to Scotland, or it has not over the past 25 to 30 years. I have never said that it did. Broadly speaking, the extra money that Scotland gets—£1,600 per head—has been paid for by the proceeds of Scotland’s oil. We can look at the analysis year by year, but the Institute of Directors analysis has said that that, roughly speaking, has been the case over the past 25 to 30 years. It is not a question of subsidy, but of fairness and of need. When we are allocating public spending across our state, there should be cognisance of where that money is required to be spent to have the biggest impact. Indeed, a progressive party—we are continually told that the SNP is progressive—should surely be at the forefront of wanting a formula based on need.
Debbie Abrahams
Will the hon. Gentleman therefore explain why he has taken £254 per household from my constituency in Oldham and given it to an affluent area in Surrey?
David Mowat
I have not taken any money from anyone, or given any money to anyone. The hon. Lady’s constituents in Oldham receive roughly £1,600 a year less from public spending than they would receive if they had the same demographic profile and lived north of the border. That is an anomaly, and it is an anomaly that causes a potential risk to a settlement that is necessary and right.
Conservative Members do not question the fact that there is a Scottish Government now, and that that Government have entitlements.
Stewart Hosie
The hon. Gentleman is knowledgeable about this matter, and he was right to say that no subsidy is implied by Barnett. Unlike most of his colleagues, he looks at both sides of the balance sheet. However, he spoilt that by talking about a needs-based assessment. Does he recognise that that would imply a £4 billion cut in Scottish funding, right now?
David Mowat
I recognise that a needs-based assessment —that is, an assessment that will result in public money being spent where it is most needed—is fairer. However, I am not saying that it should be introduced immediately, as it would be with full fiscal autonomy, and as it would have been had the hon. Gentleman’s party won the referendum. Such things can be done over a period of, say, 10 or 20 years. There can be a target for the achievement of fairness.
As I was saying, no one questions the right of the Scottish Government to provide free prescriptions and free tuition—if that is their priority—and to make different arrangements for social care. However, if such provision is predicated on a baseline of funding that is unfair and wrong, it is reasonable for us to question it, and not to let the Scottish Government get away with saying that they can take such action because it is progressive. That is neither fair nor right.
We are talking about a formula that is based on need, and a formula that the late Joel Barnett was desperate to get rid of. A House of Lords Select Committee made the position very clear. Moreover—this is not mentioned often enough—the Holtham commission identified the serious underfunding of Wales as a consequence of the Barnett formula. That problem will have to be addressed in Scotland. It is true that public spending must reflect sparsity, and must reflect the fact that Scotland’s population is more spread out. However, it also needs to reflect relative ageing and relative measures of deprivation.
Alex Salmond
The hon. Gentleman is making an interesting speech, but at its heart is something of a contradiction. He says that we must implement the vow, but scrap the Barnett formula. Is he aware that the Barnett formula features in paragraph 6 of the vow?
David Mowat
Yes, I am completely aware of that. My point is that the whole settlement will be at risk if it is not perceived as being fair in, for want of a better phrase, “middle England.” I represent a constituency that is in the north but also in the middle, depending on where you start.
Dr Philippa Whitford (Central Ayrshire) (SNP)
Will the hon. Gentleman give way?
David Mowat
No, I will not. I need to make some progress.
It is not right for my constituents to have £1,600 a year less than those who live north of the border. One solution that has been mooted is full fiscal autonomy, which one imagines is something in which nationalists believe. According to their amendment, they believe in it “in the medium term”, which was not the case when they fought the general election. That is indeed a possible solution, but it would result in a black hole. I think that we should be sympathetic, and deal with the problem in a way that would be fair to my constituents and those of the right hon. Member for Gordon (Alex Salmond).
Another possible solution would be a proper, need-based review of public spending in this country that was fair to Scotland, Wales, Northern Ireland and England. That would take a while to achieve, and I am not suggesting that it would be easy or should be implemented immediately.
David Mowat
No. I have given way twice, and I need to make some progress.
A needs-based review must be something that I would be delighted to accept if I came to Westminster representing a progressive party. Surely my progressiveness would not allow me simply to say, “We will have all we can get in Scotland”—which, as we heard from the right hon. Member for Gordon, is what was on the front page of the Daily Record. A progressive party should say, “We are not going to take all this money, because we are progressive. The settlement needs to be fair to Wales and to parts of England, where there is a great deal of deprivation.”
David Mowat
Indeed. I understand that full fiscal autonomy would take the problem away, which is, of course, why we are now seeking to implement it “in the medium term”, whatever that means.
Of course I support the vow. Of course I support the mandate that SNP Members have achieved through their spectacular election victory. It is right for us to implement this settlement, and I will vote with the Government tonight and in the future to ensure that that happens. However, I must ask the Secretary of State to reflect on the phrase that he used in his speech—“fair and lasting”—and to ask himself whether he really believes that a fiscal settlement that is absolutely and clearly not based on need can ever be described as fair and lasting. That may yet cause us problems.